Surge in bank credit for prioritized areas

(VEN) – Despite slower growth compared with the same period last year, credit grew steadily in the first five months of 2018. A State Bank of Vietnam (SBV) representative indicated positive changes in credit for prioritized areas. Commercial banks are boosting capital supply for the economy to meet business demand towards year’s end. According to Pham Thanh Ha, Director of the SBV’s Monetary Policy Department, by May 31, 2018 credit grew 6.16 percent compared with the end of 2017. This was a lower growth rate compared with 6.9 percent of the first five months last year. A National Financial Supervisory Commission report shows that in the first five months of this year, credit in VND increased by an estimated 5.6 percent and accounted for 91.9 percent of the total. At the same time, credit in foreign currency grew eight percent but accounted for a mere 8.1 percent; medium and long-term credit growth slightly decreased compared with the same period last year and grew about 5.4 percent. Commercial banks have concentrated on providing loans for manufacturing businesses in prioritized sectors to promote economic growth. By the end of May 2018, the balance of credit for businesses in the agro-forestry-fishery sector grew an estimated 6.8 percent compared with late 2017; the balance of credit for the industry-construction sector grew 6.83 percent and for the trade-service sector 5.7 percent. Nguyen Van Tan, Deputy Director of the SBV’s Credit Department affirmed that credit had been increased for prioritized areas. Specifically, credit for agriculture and… [Read full story]